Why do they want to leave France?

While New Caledonia might be richer than its neighbours, the indigenous population continues to experience social and economic disadvantages.

Ethnic divisions between the two groups have been an ongoing source of tension for decades.

Rising pro-independence sentiment among the Kanak in the 1980s led to violent unrest, which reached its peak in 1988 with the deaths of 21 people in a hostage crisis in Oueva.

New Caledonian and French leaders eventually signed the Noumea accord in 1998, which set out a timeline for the territory to assume more governmental responsibility, and mandated up to three referenda on independence.

Denise Fisher, a former Australian consul-general in Noumea and now visiting fellow at the Australian National University's Centre for European Studies, said it would potentially be a long process.

"At every turn it's hitting these sensitivities, long-held passions … it is going to be a very tense time in New Caledonia," she said.

What will New Caledonians be asked?

The question New Caledonians will be asked is: Do you want New Caledonia to accede to full sovereignty and become independent? Yes or no.

The yes and no camps came to the agreement in Paris, after 15 hours of tough negotiation overseen by French Prime Minister Edouard Phillipe.

"The pro-independence people really wanted the words 'full sovereignty' to be a part of the question because they don't actually advocate for a strong break with France," said Alexandre Dayant, a research associate at the Lowy Institute.

"They want independence with partnership with France, so the word 'independence' is actually a bit scary for them.

"And the loyalists really wanted the word 'independence' so it would scare people."

Only long-term residents of New Caledonia are allowed to vote in the referendum.

The Kanak population is broadly seen to be pro-independence while New Caledonians with European origins tend to be more in favour of remaining with France.

A poll last year showed more than half of the population would vote no, but that a fifth of those asked were undecided.

If New Caledonia votes to stay, there could be up to two more referenda on independence in the following years.

Anti-independence politician Philippe Blaise said even if French loyalist groups took the day, they would need to accept the win with humility.

"Even if the idea of independence loses in November, we will be responsible for the welfare of everyone in New Caledonia, including the Kanaks," he said.

"On the 5th of November, we will have to sit around a table and start to talk how to ensure the best future for the people, all the people, how to resolve the problems of inequalities, of education, and so we will be up to the job I think. "

Why should Australia care?

A close ally, France's presence in the Pacific with its overseas territories represents a reassuring stability to Australia.

"There's no doubt [the Noumea accord has] presided over 30 years of peace and stability on our doorstep and for Australia this has great strategic value," Ms Fisher said.

Some are concerned a vote for independence could see New Caledonia join the list of Pacific countries grappling with debts owed to China through concessionary loans for infrastructure projects.

News last month of a Beijing-funded wharf in Vanuatu that was large enough to accommodate an aircraft carrier sparked fears China was contemplating a permanent military presence in the country.

"New Caledonia, with its maritime zone, is a big element of French diplomacy," Mr Blaise said.

"We are very concerned about the threat of Chinese influence in the Pacific Ocean and we think that France has a part to play in the new alliance between India, Japan and Australia against the emergence of this new threat."